276 Pa. 459 | Pa. | 1923
Opinion by
John D. McCord, of Philadelphia, died in 1900, and by his last will created a trust of his residuary estate, which he directed his trustees to divide into seven equal parts and, inter alia, to pay the net income derived from one of said parts to his daughter, Ella McCord, during the term of her natural life. His will directs the trustees at her death, “to hold the share or portion of my estate represented by my said daughter, and from which she had been deriving the income at the time of her death, and to dispose of the same, principal and accumulated income, to and among such person and persons, and for such uses as she, my said daughter; may direct and appoint by any last will and testament, duly executed in the presence of two witnesses.’’ Ella McCord died in 1921, unmarried and without issue, and her last will states, inter alia, “1: It is my intention by this my will to dispose not only of all estate and property which I own or hold in my own right, but also all over which I have any power of appointment and especially that devised or bequeathed by the will of my father John D. McCord and it is my further intention that the entire estate and property shall be administered by my executors hereinafter named for the purpose of carrying out the provisions of my will. 2: I order and direct that my just debts and funeral expenses be paid by my said executors.” This is followed by numerous'pecuniary legacies, to relatives and others, totaling $55,500; and clause 15 is, “I direct! that all of the foregoing legacies shall be paid free of any inheritance or succession taxes, which taxes shall be paid out of my residuary-estate”; this is
The one-seventh interest passing under the power of appointment, herein called “the trust fund,” amounted to $77,000, and was turned over to Ella McCord’s executors and trustees as provided in her will. In addition to this, she left an estate of her own amounting to $23,-500, also an indebtedness of over $5,000, exclusive of counsel fees, commissions and other expenses of administration. All the legatees under Ella McCord’s will were collateral as to her but many of them were lineal descendants of her father, John D. McCord. At the audit of the Ella McCord estate the Commonwealth presented a claim of $4,555.77 (less $855 paid on account), being 5% collateral transfer inheritance tax on the clear value of the blended estate, under the Act of June 20, 1919, P. L. 521. The allowance of this claim by the orphans’ court forms the basis of this appeal by Ella McCord’s trustees.
The decree should be affirmed. The general rule undoubtedly is that an estate given under a power of appointment passes to the appointee from the donor and forms no part of the donee’s estate: Huddy’s Est., 236 Pa. 276, 281, and cases there cited; also Aubert’s App., 109 Pa. 447; 31 Cyc. 1148. In such case, where the appointee is a lineal descendant of the donor, the legacy is not subject to a collateral inheritance tax: Com. v. Williams’ Executors, 13 Pa. 29. Here, however, Ella McCord’s power of appointment by will being unlimited, she could transfer the trust fund to her own estate and did so in unmistakable language, making it a part thereof for all purposes; her intent to do so is emphasized by the fact that her will makes no further mention of the power or trust fund. It thus became blended with her other property as one estate, from which debts and legacies, were payable.. Not one of the numerous pecuniary bequests is payable from any particular fund. She makes the trust fund a part of her own estate and
The decree is affirmed, costs to be paid by Ella McCord’s estate.